Unnamed business in indictment appears to be Jacksonville firm

Christopher Hong @ChrisHongTUDavid Bauerlein @DavidBauerlein

Monday

Jun 4, 2018 at 7:14 PMJun 5, 2018 at 8:57 AM

The indictment of City Council members Katrina Brown and Reggie Brown allege that fake invoices prepared by Katrina Brown included one for purchase of furniture from an unidentified business. Retired firefighter who runs VC Gantt, LLC declines comment.

An unnamed company identified only as "Entity A" in the federal fraud case involving two City Council members appears to be a local business run by a retired Jacksonville fire department lieutenant, based on details in the indictment and bank records.

Vanderen C. Gantt, who is CEO of VC Gantt LLC, declined comment Monday when asked if the indictment refers to him.

The federal indictment unsealed last Thursday brings changes of fraud and money laundering against City Council members Katrina Brown and Reggie Brown. The indictment does not carry charges for any other individuals.

A portion of the 60-page indictment alleges that Katrina Brown created a fraudulent invoice for $6,083 in furniture purchases from "Person C's business," which the indictment calls "Entity A."

The indictment says that after a bank released funds from a U.S. Small Business Administration loan based on the invoice, Person C later withdrew $5,583 in cash from the business's account and provided it to Brown.

The U.S. Department of Justice declined to comment on any aspect of the indictment beyond what is in it.

Curtis Fallgatter, a defense attorney representing Katrina Brown, said the Justice Department has a long-standing law that if someone is a witness or wasn't indicted, that person's name is not disclosed in an indictment. He said based on that, he declined to comment on the identity of unnamed people in the indictment.

The case against Katrina Brown and Reggie Brown, who are not related, alleges they conspired to start two businesses so Katrina Brown could file fraudulent invoices totaling almost $265,000 for business expenses for a Jerome Brown BBQ Sauce plant that received a $2.65 million loan backed by the U.S. Small Business Administration along with $590,000 in city grants and loans.

The indictment alleges at least $179,000 of the SBA loan proceeds released as a result of those invoices went to Basic Products LLC, which Katrina Brown co-owned for the barbecue sauce business. The rest went to Reggie Brown even though the businesses cited in the invoices provided "no legitimate services," according to federal prosecutors.

Attorneys for the council members, whom Gov. Rick Scott suspended from office Friday while their case is pending, say the invoices were legitimate and proceeds of the bank loan were for appropriate expenses.

On a smaller scale, the indictment describes another invoice sent by Katrina Brown to Biz Capital for furniture expenses billed to an unnamed business. The indictment alleges she prepared a fraudulent $6,083 invoice for furniture purchases from "Person C's business."

Records provided by Biz Capital to the city in 2014 itemized dozens of disbursements made by the bank from the SBA loan. Those record show that in October 2013, the bank disbursed $6,083 to VC Gantt LLC using the same check number cited by the indictment.

The indictment alleges that after the bank routed that disbursement to Person C, that person deposited it into the business's bank account and then withdrew $5,583 later that month and gave the cash to Katrina Brown, who subsequently deposited $4,000 in cash into an account for Basic Products.

Fallgatter said the invoice for Person C's business was not fake. He said like all companies experience in the business world, "sometimes there's a change in business plans," but all the invoices were prepared to have work done at the sauce plant.

When asked on Monday if he was referenced in the indictment, Gantt told a reporter he didn't want to comment.

Around the same time prosecutors say Katrina Brown prepared fraudulent invoices for furniture purchases from Person C's business, Gantt was tapped by former Mayor Alvin Brown to serve on the Jacksonville Housing and Community Development Commission.

However, his appointment was never approved by the City Council. Several months later, Brown appointed him to serve on a monitoring committee for the Jacksonville Small and Emerging Business Program. He joined the committee in 2014 and left later that year.

Gantt was a lieutenant with the Jacksonville Fire and Rescue Department, according to a resume submitted to the city for his appointment. The resume described his business, VC Gantt LLC, as a property management firm.

VC Gantt LLC supported Katrina Brown's 2015 campaign for City Council with a $500 contribution.

David Bauerlein: (904) 359-4581, dbauerlein@jacksonville.com;

Christopher Hong: (904) 359-4272, chong@jacksonville.com

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